Blockchain technology was first described by the research scientists Stuart Haber and W. Scott Stornetta in 1991. But it wasn’t until 2008 that it started to get some real relevance.
A scientist or a group of scientists behind the alias name Satoshi Nakamoto have created the blockchain technology as we know it today. Its primal purpose was to enable Bitcoin users to perform direct digital transactions without the need for any validation from a third party, such as a bank.
Today, blockchain is on its way to becoming the most widely used record-keeping system in the world. It is certainly a hot topic these days, but what is blockchain technology?
It is a system that stores chunks of data in blocks. Once one block reaches its storage capacity, it links to the previously filled block, thus forming a chain of data.
Simply put, a blockchain is a distributed ledger for secure transactions without a third party involved. This data storage system is practically unhackable.
We can differentiate three main types of blockchains:
- Public – mostly used for cryptocurrency and peer-to-peer transactions.
- Private – used for supply-chain management and data storage tasks. Private blockchains have a limited range and controlled features.
- Hybrid – authorization blockchain that can enable only certain participants in the network and decide on their access level.
Assisted by the top blockchain development companies, more and more businesses in Europe and worldwide are interested in integrating blockchain technologies into their systems and enjoy the benefits of enhanced security, greater transparency, instant traceability, increased efficiency, and automation.
The EU is looking to become the leader in blockchain technology innovations, so much so that they have developed the European Commission’s blockchain strategy, which we will now discuss in detail.
Golden standards
The European Commission created a blockchain strategy that aims to follow these five golden standards:
- Sustainability – making a blockchain technology that runs on renewable energy resources.
- Secure data – making a blockchain technology that supports and is compatible with privacy regulations.
- Digital identity – making blockchain technology compatible with e-signature regulations and with a decentralized and self-governing identity framework.
- Cybersecurity – making blockchain technology to be hacker-proof.
- Interoperability – making blockchain technologies interoperable with themselves and the outside world’s legacy systems.
Aspects of the European Commission’s blockchain strategy
The European Commission’s blockchain strategy includes:
- Creating a pan-European public services blockchain – The European public sector is building its own blockchain infrastructure that aims to include interoperability with private sector platforms.
- Legal certainty promotion – The commission is developing legal frameworks for digital assets and smart contacts. These frameworks should protect the users and ensure legal certainty for all businesses involved.
- More funding for blockchain research and innovations – The EU offers grants and supporting investments for startups and projects targeting Artificial Intelligence (AI) and blockchain research and innovations.
- Encouraging blockchain skills development – The Digital Europe Programme formed a €580 million budget for educating skilled digital experts to make sure there is enough personnel to meet future demands.
- Interaction with the community – The Commission interacts with the community through The International Association of Trusted Blockchain Applications (INATBA), The European Blockchain Observatory, and the Forum.
- Supporting blockchain for sustainability, interoperability, and standards.
Blockchain has a great potential for changing the future of transaction-based industries and other industry sectors. Even though it was primarily created for secure bitcoin transactions, it has found many uses in different industries.
Here is what a blockchain deployment through industries in Europe looks like:
- 25.76 % – Tech, IT, Telecommunication;
- 19% – Government services;
- 14.90% – Financial Services, FinTech, KYC, AML;
- 8.83% – Education;
- 7.58% – Supply chain, Transportation, Industrial manufacturing;
- 6.07% – Media, Entertainment, Publishing;
- 5.56% – Non-profit or Social Impact;
- 4.30% – Energy, Environment, Utilities;
- 2.53% – Health care.
No European country enforced any hostile rules and regulations against blockchain and cryptocurrencies. Some countries have more advanced blockchain ecosystems than others.
Cyprus, Malta, and Switzerland were the quickest to implement the blockchain technology and institute strategic regulatory frameworks.
While France and Germany have prepared advanced regulatory frameworks for wider blockchain usage but are yet to implement comprehensive applications.
Conclusion
The EU believes that intergovernmental support, together with private investments, can create a strong foundation for fast blockchain technology adoption across Europe over the next decade.
They aim to extend the reach of blockchain technology beyond financial-based usage and start to use its transformative efficiencies in other important sectors too.
Blockchain technology is of strategic importance to the European Union and is most likely to play a leading role in reinforcing technological supremacy.
